What Are The Top Things To Do With Your Dog In Charleston?

What-Are-The-Top-Things-To-Do-With-Your-Dog-In-Charleston_

Dogs have often always typically been described as man’s best friend. Charleston SC is renowned for it’s fine southern charm, cobblestone streets and architecture, and an exquisite dining experience. The city has also made a name for being one of the most dog-friendly places you will ever visit. Winning the 2016 edition of the Best Pet Travelers City competition attests to this. This may have left yourself wondering, what are the top things to do with your dog in Charleston?

 

Walking down the streets of Charleston, don’t be surprised when you notice tens of residents and visitors walking or even playing with their dogs everywhere. Simply put, rearing dogs is part of the city’s culture due to how often local citizens prefer being outside as soon as the weather permits. This coupled with the fact that Charleston has lenient laws pertaining to pet rearing, has encouraged more residents to walk around with their dogs or enjoy the local sights accompanied by their furry friends!

 

Even though Charleston is known for its dog-friendly nature, there are certain rules that must be adhered to nonetheless. Most importantly, the dogs require a leash the majority of the time. The following are the top places to take your dog in Charleston.

 

Stroll King Street

Do you want to learn more about Charleston’s rich history while enjoying a cool afternoon sea breeze? If so, a walk on King Street absolutely needs to be be on your bucket list. This street dates back to the Civil War, and is a favorite among dog owners. It is impeccably kept, and faces Charleston Harbor thus ensuring that you amply catch the cool breeze whenever you take your dog for a walk. If you’re looking something really special, be sure to check out Second Sundays on King Street (when the street is blocked off from cars and scores of guests delight on the local boutiques and restaurants). It’s a dog lovers paradise!

 

Waterfront Park

Located right at the end of King Street is Charleston’s renowned Waterfront Park. It is one of the most favorite weekend hangout spots among residents and visitors alike. The ample space ensures that you can play with your dog and even socialize with other pet owners in the process. The park is characterized by winding walking paths, cool evening ocean breezes, and salty air, which your dogs will certainly love. The park is loved by pet owners since it has leash-free hours.

 

Marion Square And The Charleston Farmer’s Market

Marion Square is a central plaza located in downtown Charleston. Whether it’s seeking a few items from your grocery list when the Farmer’s Market is open; this square is an open space that hosts a number of events, be it Spring or Fall. These festivities include food festivals, Charleston fashion week,  and even a few music festivals. The food festivals are known for accommodating dogs. Some even go ahead to offer treats including food and water. Even if you want to go when there is no event set up, your dog will definitely have as much fun as you at this famed hotspot.

 

James Island County Park

While this park may be further from downtown, it is one of the best places to take your dog to. James Island County Park is expansive enough to allow you let your dog free from its leash. It features pools, miniature balls, and other remarkable features, which make the $2 admission fee look like a bargain.

 

Hampton Park Dog Park

Should you prefer a park that is closer to Upper King Street, you may be able to get your fix at this park on Grove Street not too far away from Hampton Park. Centrally located with ample parking as well, this park includes a water spigot specifically for the dogs and a few benches for you to relax on.

 

Beaches

What’s the point of having a dog in Charleston if you’re not going to take it to the beach? Nothing gives dog owners greater satisfaction than seeing their pets belly-flopping on sand and playing in the water with careless abandon. You have to check out any of Charleston’s public beaches (Sullivan’s Island and Folly Beach) with your four legged friends. Nonetheless, a number of restrictions do come into play when with Toto on the beach. During the April-September season, most Charleston beaches only admit pets at off-peak hours (early morning and in the evening). This can make it even more fun since you will only be allowed to be on the beach when there are less people. This also decreases the possibility of running into any issues with other dog owners or possibly tourists on the beach.

 

There are numerous dog-friendly things to do in Charleston. Even when visiting the city with your favorite dogs, you will have an endless array of places to visit, and activities to partake in. If you are a pet lover, consider visiting Charleston to savor the city’s dog-friendly culture if you haven’t already.

 

If you’re considering buying or selling in Charleston, let’s talk today.

If I Want To Start A Family, What Do I Need To Know Before I Buy A Home?

If-I-Want-To-Start-A-Family-What-Do-I-Need-To-Know-Before-I-Buy-A-Home?

Making the decision to start a family is one of the most important choices you’ll make in your life. It is not something to rush into. Aside from making sure that you are financially ready to support a child, you’ll also need to think about your living situation. Here are the primary concerns you’ll need to take into consideration when buying a home for your growing family.

Your Budget

One of the most important factors you’ll need to evaluate is your budget. You’ll need to find a balance between buying a house that will be large enough to accommodate the changing needs of your family going forward and making sure that it is a home that you can afford.

Remember that children will add several new categories to your budget, including diapers, baby food and an ongoing supply of new clothes as they grow. You’ll also need to factor in unexpected expenses, like visits to the pediatrician or emergency room, when your child gets sick. You will not want to be stretched so thin that you wouldn’t be able to cover these expenses while still making your mortgage payments.

Number of Children

In your mind, you may like the sound of having four children, but that doesn’t necessarily mean that you actually will (nor that it’s the right idea for you). On the other hand, you may think you only want one child but then change your mind later and want to grow your family even more.

In selecting a house, look for one that will be able to house your first child with the possibility of more. Young children can share a bedroom, even if they are of opposite sexes, so don’t feel the need to have separate bedrooms for each child. If you can afford it, get a house with an extra bedroom. You can always use it as a guest bedroom for when the grandparents or that Uncle Jesse in your family decides to make a visit.

Schools in the Area

Your children will need to go to school at some point, unless you plan on homeschooling, so be absolutely sure to look for a neighborhood with good schools.. Focus primarily on the elementary and middle schools, as you may very well end up  moving again by the time your children reach high school.

Family-Friendly Attractions

You’ll want to look for an area that provides plenty of fun things for young children to do. Look for parks and playgrounds nearby, as you’ll likely be spending a fair bit of time there. Day care centers, indoor playgrounds and even toy stores in the area can be signs that a neighborhood is family-friendly.

Safety

Finally, you’ll want to make sure that the neighborhood will be safe for your children. Check the crime rate in the area, and look for possible houses on cul-de-sacs. Kids love to play with their friends out in the street, and you don’t want tons of cars whizzing by during rush hour if you can avoid it. Look for other children playing outside or families walking together along the sidewalk. These are positive signs that a neighborhood is safe for children.

Look to the Future

So many home buyers will initially only consider (and still buy) homes that they only plan to stay in for a couple of years, instead of thinking longer term when their children will get older and what items they will need at that time. Once they make friends, uprooting them will become harder. Be sure to think about what is going on in the area and how it might change over the years. Think about what your kids will need then, and not solely what they will only need in the next couple years.  Will this house still be suitable for your family five or even ten years down the line? If the answer is “yes,” you may have very well found your dream home!

 

If You Are Considering Buying, Let’s Talk About What’s Available In Charleston Today.

If We’re Retiring And Looking For A New Home, What Do We Need To Consider?

If-We're-Retiring-And-Looking-For-A-New-Home-What-Do-We-Need-To-Consider?

Retirement brings about numerous changes, with one of the of the most significant changes possibly being your change of  residence. Homeowners who have recently retired or who are planning their final days in the workforce may need to reevaluate their living situations. This might leave thoes retirning and looking for a new home, wondering what they need to consider. Upgrading, downsizing, or even buying a second home can help retirees ensure their families’ future comfort or earn extra monthly income.

 

Be sure to consider these points before buying a new home in which to spend your retirement years.

 

Leaving a Legacy

Retiring well means more than just having enough to keep you and your spouse comfortable. A good retirement includes the ability to leave something behind to keep your family growing strong when you can’t be with them. Retiring parents might buy a second home for many reasons.

  • Is your current home just too big? Consider buying a second, smaller home to live in. Use your large family home for big family gatherings like weddings and special holiday events. You can also use it as a guest-house, a vacation home for your adult children, or as a storage for all your family’s precious treasures.
  • The fluctuating economy is making it difficult for young families to get a good start. A 2013 study found that 36% of adults between the ages of 18 and 31 lived with their parents. Retiring parents can help their adult children reach independence by purchasing a large property they can share if it ever becomes necessary to do so.
  • Retiring parents with special needs adult children may want to buy a new home that features a detached dwelling or “mother-in-law” quarters. The adult children can learn to live independently while you are still around to guide them. When you are gone, the designated caregiver can move in and your child can continue living in the comfort they’ve come to know.

 

Generate Income

Just because you aren’t working doesn’t mean you can’t make a little extra cash. You can use additional properties to boost your monthly income so you can afford to have all the fun you deserve.

  • Consider downsizing into something more suitable for your needs. Rent out your large family home on a monthly basis or possibly offer short-term rental services like Airbnb. You may decided to contract with a property management service to handle repairs, collections, and all the other landlord duties. Your property will be maintained and available if your plans ever change..
  • Retirement is the time to do what you’ve always wanted to do with your life. You might purchase a small property to house your new business. Or upgrade your current home to one that has plenty of space for your woodworking, papercraft, metal art, or whatever hobby you want to convert into a paying enterprise. You might even look for properties that have unique features you can use to make your work easier. A screened porch very well might be the perfect place to paint.
  • You may even consider easing your yearly tax burden by donating your existing home to a local charity. You will enjoy generous tax deductions while giving back to your community. Since the home still belongs to you, you can leave it to whomever you like in your will. This is a great way to preserve wealth for your family while also reducing your expenses.

 

Buying a new home during retirement can help seniors achieve the right balance, help their loved ones, and even increase or protect their wealth.

 

If You Are Considering Buying Or Selling, Let’s Talk About What Options There Are Today.

What Benefits Do First Time Home Owners Enjoy?

What-Are-The-Top-Benefits-For-First-Time-Home-Owners?Buying and becoming a new homeowner can be a difficult challenge, and an extremely rewarding endeavor once you own your first home. As a new homeowner, you gain access to several different tax benefits for both primary or secondary residents such as vacation homes. With recent changes to the federal tax law, it is important to review how home tax credits were affected. There were many alliterations of the tax bill reported on in the press and luckily many of the more severe recommendations were not passed in the final bill. However, some changes were made and are reflected below where applicable. Here is a broad overview of the five federal tax credits you can claim as a homeowner.    

 

Real Estate Taxes: Referring to state and local property taxes, under the proposed changes to the 2018 tax bill, this is a deduction cap of $10,000 total for state and local property tax and associated income or sales taxes. This limit is the same for both single and married couples filing jointly.  

 

Concerning Your Other Deductions: When taking a tax credit for mortgage-related tax benefits you have to itemize your deductions. This can be highly advantageous because it allows you to take credit on other non-home related tax write-offs that have to be itemized to be claimed. These include unreimbursed employment expenses, charitable giving, medical expenses, and others.  

 

Loan Interest Deduction: For 2018 you can deduct interest payments on your home’s mortgage as long as your mortgage is less than $750,000 or $375,000 for married couples filing separate returns. Note that these figures were higher in previous years but recent tax law changes resulted in the above figures. Unchanged is the fact you must have a loan secured by the home and the home must be your main or secondary residence.      

 

Points: Note the interest you paid upfront during the mortgage closing process. As this type of payment improves your overall mortgage rate, most closings have points to some degree. These are deductible provided you meet several specific criteria. Key amongst these is that points must be paid with a secured loan, the loan in question must be secured by your main home, and the mortgage loan goes toward your home’s purchase or construction. Also, note your points total value must be in the ‘normal range’ for your geographic area and the surrounding home market values. Figures deemed unusual may result in this credit not being usable.  

 

Future Tax Benefits: Lastly, you can claim a capital gains write off when you sell the home in the future provided you meet the habitation requirements. You have to live at the residence for 2 of the last 5 years and these two years do not have to be concurrent. By meeting these requirements you do not have to pay taxes on gains on a home sale up to a specific amount. The limits are $250,000 if filing single or $500,000 if filing jointly. This law was unchanged in the 2018 Tax Bill despite being considered at various points for modification or outright removal.    

 

Final Considerations

As the above shows, there are several tax advantages to purchasing a home. Despite changes made to the tax code these benefits are still ones that should not be ignored and should be correctly accounted for on your tax return. As always should you need further clarification on these or similar real estate matters, a knowledgeable and professional realtor will be able to give you a bit more detail.

 

Whether you need to sell your home, or solely looking for one to buy; let’s talk about what’s available today.

In A City Full Of Realtors, How Do I Decide Which One To Go With?

In-A-City-Full-Of-Realtors-How-Do-I-Decide-Which-One-To-Go-With?

Here in Charleston, you may find yourself with a lot of choices when it comes to Realtors and real estate agents. Because of this, it can be difficult to separate the average agents from those who truly excel. Here’s what to look for when choosing an agent to represent you in your real estate dealings.

 

Communication

Communication is one of the most important skills a Realtor or real estate agent must have, let alone for any business. After all, you’re going to be in touch frequently throughout the home buying or selling process, so you want your representative to be as accessible as possible. Real estate doesn’t necessarily follow traditional business hours, so your agent shouldn’t either. Ask about their policies on after-hours or weekend communication to ensure they’ll be accessible when you have questions or need advice.

 

Personalized Service

You want to choose an agent who will find exactly what you are looking for, and this requires getting to know your taste and preferences. Attention to detail is vital for this, so look for an agent who will take the time to get to know you on a personal level and truly understands your needs and preferences, not just for the size and location of the home but also in terms of the layout, style and any other preferences you may have.

 

Past Experience

It is helpful to have a Realtor who has experience helping clients buy and sell the type of home you are seeking. For example, if you are looking for a luxury property in an upscale area, an agent whose experience comes mostly from starter homes in affordable areas may not be the best fit. This doesn’t mean that an up-and-coming agent can’t help you, but you may be better off with a Realtor who better understands your market. Ask about past sales and purchases to get a better sense of their forte.

 

Approach

Some Realtors are more aggressive than others in terms of negotiating, so you want to ensure that your representative will stand up for what you want. Of course, you need to have room for some flexibility, as the other party will have their interests in mind as well, but you want to have confidence that your agent is doing everything in their power to achieve favorable results for you.

 

Knowledge

Knowledge of the local area is absolutely critical for the agent you choose. You want someone who either lives in the area themselves or has been working there for a long time. This way, they’ll have insider knowledge as to which schools are the best, where the top amenities are located and other information that may be important to you. This is especially important if you are moving from another city or state and aren’t familiar with the area yourself.

 

Ongoing Service

It’s one thing to be a great Realtor during the process or buying or selling a home, but it is quite another to maintain relationships with clients after the deal closes. Every agent will work closely with you during the process, but many are not as attentive after the fact. Ask the Realtors you are considering what ongoing services they may provide. If they don’t have a good answer, you may want to look elsewhere to find someone more attentive.

 

Finding the right Realtor is almost as important as finding the right home, so be sure to take your time in choosing your agent. Ask pointed questions, and make note of the answers to reference later when it comes time to make your decision. With a bit of patience and research, you are sure to find the perfect agent to represent your interests.

 

If You Are Considering Buying Or Selling This Year, Let’s Talk About What Options There Are Today.

How Can I Save Money With Smart Home Technology?

how-can-i-save-money-with-smart-home-technology

As far as home ownership is concerned, there can be a lot to it than meets the eye. Aside from expenses like property taxes, you have to deal with monthly utility bills, which can take up a significant portion of your money. Nevertheless, technological advancement appears to be changing this situation by availing numerous smart home tech products aimed at cutting such costs without compromising the allure of top-of-the-line technology. Hence, if you are interested in cutting costs and transforming your Charleston SC home into a smart home, consider adding these smart in-home products.

 

Electricity

Electricity helps with your lighting, heating, cooling, running electrical devices, and cooking among other things.  For this reason, electricity bills are normally high for most homeowners. To avoid being a victim of such varying costs that fluctuate with the seasons, consider trying these products:

 

  • Smart Lights

Unlike their incandescent counterparts, smart LED lights such as the Philips Hue line are programmable.  Aside from features like motion detection, you can access and control them remotely using voice assistants such as Siri and Alexa.  Furthermore, they are less costly to operate thanks to their dimmable feature. That’s without even mentioning how fun it can be to go through the different colors now available with your lighting!

 

  • Smart Thermostats

Thanks to smart thermostats, you can effectively save money on heating and cooling your home. In fact, some of the leading thermostats on the market like Nest thermostats eliminate unnecessary energy consumption through customizing cooling and heating schedules. Also, most of these gadgets not only boast of sensors to monitor cold and hot home areas but they are also remotely programmable. You can save a sgnificant amount on your energy bills by automating your home’s temperature when you are not there or asleep. Setting your thermostat higher in the summer or colder in the winter (when you’re not home or awake) can lead to a significant reduction in your energy use.

 

  • Surge Protectors

Television sets, gaming devices, computers and other electronic devices suck up your electricity even when they are not in use, as long as they are still plugged into a socket.  With surge protectors (such as the Belkin Conserve Switch Surge Protector), you can even switch your devices off remotely. You can also rely on smart plugs like the iDevices Switch, which cuts power to your devices remotely.

 

Water

Although you cannot do without water, you can regulate the amount of money you spend on water bills. Here are some options that can slash your water expenditure considerably.

 

  • Smart Toilets

These toilets can help in keeping your home green by getting rid of toilet paper waste and saving water. According to EPA, toilets that come with a WaterSense label minimize water consumption by 20-60%. Consider going green by installing a smart toilet.

 

  • Smart Water Meter

Failing to keep tabs with your water consumption can occasionally lead to high water bills. As such, you might want to consider a smart home water meter to help you monitor not only how you are utilizing water in your home, but also the amount. In turn, you can easily verify the amount of water that is going into various uses like lawn maintenance or possibly laundry.

 

  • Faucet Aerator

By installing a high-efficiency faucet aerator on your taps and in your shower, you can minimize your water consumption in half.  The aerator limits the flow of water via the faucet in comparison to the water flow of a tap without an aerator. Furthermore, adding this feature to your taps eliminates your low-pressure problems.

 

Security

Lastly, by adding a smart home security system you can significantly save your money, particularly on costs like homeowners insurance. You will end up paying lower insurance premiums than usual for putting in the right measures to avert risk.

 

Do not sit around and let high utility bills be an issue when you decide to move into a new home (or the one you’re already in). You can absolutely do better things with that money. So, be sure to consider the above smart products and a myriad of others on the market today in a bid to save money and go green!

 

If you’re considering real estate decisions in Charleston, be sure to contact us today!

 

What Should I Be On The Look For During A Home Tour?

What-Should-I-Be-On-The-Look-For-During-A-Home-Tour?

When it comes to any major purchasing decision like buying a home, you always want to be sure of what you’re getting before you buy. There may not be enough time for you to have a second home tour with friends and family for a different opinion on it. It is therefore vital to have a guideline on the areas to look out for before making a decision. The first tour is essential, and one needs to focus their attention on things that will be hard or expensive to change in future as opposed to temporary issues such as personal items, décor and paint colors. Here are a few key areas of a home you should be focusing on:

 

Areas Of The Home To Concentrate On

  • Location

This is one of the most critical areas to look out for during a home tour. Consider the traffic flow (things to consider) to your ideal home, as congestion would mean getting to work or back home late (plus further expenses like your time and that increased transportation cost). For a potential pleasant presence with the location of your future home, be sure to consider the road systems, nearby buildings, noise, and other neighboring homes. Look out for proximity to public transport and on whether the neighborhood has ample sidewalks and paths that accommodate a leisurely stroll or a bike ride.

 

  • Lighting

Be sure to look out for whether the house has access to natural light, and permits good airflow. Fresh air and sunlight make a living in a home much more enjoyable, and it helps in reducing the utility bills during summer months (when you’re not lying on the beach) by opening the windows and catching a breeze.

 

  • Flooring

Consider whether the floor plans and room sizes match your preferences. Does the home have all the rooms you need and in the best size? It is expensive and takes a lot of time to bring down walls trying to create a bigger space. Look out for uneven flooring such as cracks, as it is expensive to repair foundation-associated problems.

 

  • Water Damage

Look out for possible water damage signs such as musty odor, dark spots and water lines on the ceiling and walls as they are an indication of damages from a leak or burst pipe. It is important to peek at any exposed piping in the laundry room (or possibly) basement to assess water stains, leaks or rust. It is easy to repair a water leakage, but when it has gone for months without detection and has caused notable damages, it could also mean it is unrepairable.

 

  • Roofs and Gutters

Be sure to look at the roof to make sure it is not worn out.Gutters should be intact. To determine the maintenance level of the roof look out for missing, covered or curling roof tiles. Also check on whether the roof structure has signs of leakages as this could for a new roof which is expensive. The roof may fail to meet the required standards necessary for processing your insurance or mortgage.

 

  • Space of the Closet

This could be a deal breaker for you in deciding on the home. The storage space should be ideally large enough to accommodate all your belongings and help you at keeping organized.

 

  • Windows

Pull the curtains to check on the status of the windows. Look out for lopsided frames and give the windows a take to ensure that they slide with ease. Windows that stick while opening may indicate poor foundational issues or poor installation, which can be expensive to repair.

 

  • The Driveway and Parking area

Be sure to check out the dimensions of the driveway and parking area. A narrow driveway while become frustrating in the long term. A very long driveway will necessitate future maintenance that you may not be completely up for in the future.

 

Now no matter what your thoughts are always remember to keep them to yourself when touring a home for better bargaining. You might consider bringing a camera (or use your phone if you prefer) to take photos of the property, or possibly even measuring tape in case you decide you’d like to measure something in the house.

 

These are only a few things to be on the look out for.

 

If you’re looking for a new home, a great realtor will be able to help you find what you’re looking for.

 

If you need help finding the right home, contact us today to see what’s available.

Why Is Home Ownership Important For The American Economy?

Why-Is-Home-Ownership-Important-For-The-American-Economy?

Homebuilding and real estate sit at the top of the food chain when it comes to fueling economic growth. Home ownership has been the absolute foundation for wealth building for centuries and the process of constructing homes fuels many sectors of the economy. Once built, those homes continue to support and grow economic activity both locally and nationally.

 

Consider these statistics about homebuilding and homeownership in the U.S. :

  • A Federal Reserve study found that the median net worth of homeowners reached $195,400 in 2013 compared to $5,400 for renters.
  • The National Association of Realtors (NAR) found that for every two homes sold (including new and resale), one job is created. Findings from a study executed by the National Association of Home Builders (NAHB) echoed those findings, which found that 3.94 jobs were created for every 100 single-family home built.

 

How Real Estate Supports the Economy

Activity in the field of real estate has a trickle-down effect that permeates nearly every other economic sector. The process of building a home is labor-intensive from the start. It starts with planning and zoning at the local level. Builders represent themselves or hire lawyers, both of whom make good salaries. Once approved, the builder uses local contractors to develop the land and build the homes.

 

The jobs in the building trades pay fairly well, and the employees and their families have room in their budgets for discretionary spending that creates even more jobs at the local retail level. The workers also need plenty of services from the local area, and homes for themselves. New homes need lots of materials and appliances, and all that purchasing creates another trickle down-flow through the local and national economy.

 

The National Association of Homebuilders reported that in 2015, 394 jobs were created for every 100 single-family homes built. Building these homes generated $28.7 million dollars in the private sector and $3.6 million in revenues for local governments. Once built, those families who occupy them continue to contribute to the well-being of the local economy by generating 69 jobs and $5.1 million in private and local revenues every year.

 

Apartments also have a direct impact on local economies, but not to the extent that for-sale properties do, especially after they’re constructed. Individual home owners are far more likely to make discretionary improvements compared to apartment owners who are interested in short-term profitability rather than long-term investment value or comfort.

 

The Role of Supply and Demand

The laws of supply and demand exert a heavy influence in the residential real estate market. When the economy is booming and jobs are being created, real estate values go up. Even when job growth slows, real estate values typically continue to climb in markets where insufficient land availability or the lack of new home inventory increases the demand for homes.

 

Appreciation Rate Trends in Charleston

Based on data collected by the NAR, the median price of homes sold in the Charleston area from 2012 to 2016 rose by $50,000 to $240,000 in 2016. Over the four year period, this increase leveled out to $12,500 annually. The U.S. Housing and Urban Development (HUD) reported that the average home price increased four percent from 2016 to 2017.

 

Bottom Line

Homeownership forms the foundation for economic well-being and wealth-building in the U.S. Homeowners benefit directly by building equity by owning their own homes, as do all the others who gain from its presence long after the home’s been built.

 

Home ownership is a vital metric when it comes to the American economy.

 

If you’re considering buying or selling in Charleston, let’s talk about what’s available today!

How Will Interest Rate Changes Affect Real Estate Decisions This Year?

As you may have seen in recent national news,  the Federal Reserve will be increasing interest rates. These interest rate increases are predicated on the continuing healthy economy, low unemployment, and the overall good health of the market . This increase in short-term interest does not target specific industries, however it does affect several that use loans as a part of daily business activities. One such industry is the real estate market. The Federal Reserve’s actions can affect adjustable rate mortgages and to a lesser extent fixed-rate mortgages. These effects are as follows.

 

Effect On Mortgages

  • Adjustable Rate Mortgages: These will be affected in the following ways. Due to the fact that adjustable rate mortgages are reviewed annually any increase in rates will, in turn, increase the amount of interest due monthly. Note that there may be a delay in this due to when refinancing occurs, but the changes may be notable depending on the value of the loan itself.   
  • Fixed Rate Mortgages: Please note that this refers to new fixed-rate mortgages and not existing ones. Fixed rate mortgages will be far more resistant to federal interest rate changes. When viewed over the long term (fixed rate mortgages being 15 or 30 years long) these rates tend to follow inflation rates more than they do federal interest rates. Also, depending on how the market responds to the Federal Reserve being viewed as controlling inflation with these measures, the interest rate of 30-year mortgages could go down.   

 

Real Estate Purchasing Considerations

Now certainly an increase in overall real estate cost is nothing to be pleased with. That being said, while it should be carefully considered when making real estate discussions it shouldn’t be overvalued in the overall process. Here are four considerations to keep in mind.

 

  • The Long-Term Value Of Real Estate: A key aspect of real estate that makes it an active investment is that it tends to increase in value over time. In many cases, the increase in the value of a property or home will greatly surpass any interest rate increases.   
  • Real Estate Protects Against Inflation: Due to real estate’s tendency to appreciate in value, it serves as useful investment tool when held over a long period of time. When compared to other investment options that are more flat in terms of their overall return, real estate offers strong value and can be used for portfolio diversification.
  • This May Not Be The Best Time For Refinancing: Interest rate increases can make refinancing an existing fixed rate mortgage a less attractive option. However, this depends greatly on your existing financial situation. Even with higher interest, refinancing may still be desirable if you have a specific goal in mind such as shortening the length of your mortgage loan.     
  • Other Market Effects: An increase in interest rates may discourage some marginal buyers from purchasing real estate. This could reduce overall real estate costs as there are more homes for sale in a market with less interested buyers. There are also industry experts calling for an increase in construction to keep rate increases low.  

 

Final Thoughts

The Federal Reserve’s increasing of interest rates will have an effect on real estate purchases. Those most affected by these changes will be ARM holders, those seeking to secure new loans, and homeowners seeking to refinance existing fixed-rate mortgages. Real estate nonetheless remains a solid investment with a long-term growth pattern and an increase in federal interest rates should not deter you from making well thought out and researched real estate purchases.    

 

If You’re Planning A Real Estate Decision, Let’s Talk About What’s Best For You Today!